Trump and Japanese Prime Minister Abe discuss trade at G7

US President Donald Trump says he and Japan's Prime Minister Shinzo Abe have agreed on the principles of a trade deal

The pair have met during the G7 at Biarritz in France.

The proposed deal is modest in size, encompassing just $7 billion of goods, mainly in the agriculture, industrial and digital sectors

BIARRITZ, France - U.S. President Donald Trump says he and Japan's Prime Minister Shinzo Abe have agreed on the principles of a trade deal that would probably be signed next month in New York.

The pair have met during the G7 at Biarritz in France.

The proposed deal is modest in size, encompassing just $7 billion of goods, mainly in the agriculture, industrial and digital sectors, although military contracts have also been discussed.

"We're having some very good discussions, maybe even great discussions. And I will say that our relationship with Prime Minister Abe and Japan has been, I think, the best it's ever been. I don't know, I'll let you speak to that. But I think it's the best it's ever been," Trump said Saturday at a joint press briefing with Prime Minister Abe.

"We're discussing trade. We're doing a lot of trade together; a lot of military trade, actually, which is a big component."

Asked specifically if he had agreed to a trade deal with Japan, the president replied: "We're working on one, and we're fairly close.....A very big deal. It's a major deal with Japan. If it gets done, we'll possibly know by the end of this meeting."

"We have excess corn in various parts of our country with our farmers because China did not do what they said they were going to do. And Prime Minister Abe on behalf of Japan, they're going to be buying all of that corn," the president later posted on Twitter.